- Ripple released its Q2 report early on Friday, celebrating the lawsuit win from July 2023 and expressing confidence in the final ruling.
- Report reveals Binance, Bybit and Upbit are top exchanges that dominate XRP trading volume.
- XRP noted over 65% decline in transactions in Q2, erased 6% of its value on Friday.
Ripple (XRP) published its Q2 2024 report, highlighting the QoQ changes in on-chain activity, dominant crypto exchanges contributing to XRP trade volume, regulatory developments and lawsuit updates.
XRP erased nearly 6% of its value and is down to $0.56 early on Friday.
Daily digest market movers: Ripple lauds past laurels, XRP traders await SEC lawsuit ruling
- In its Q2 report, Ripple celebrates its “landmark win” against the Securities & Exchange Commission (SEC) in Judge Analisa Torres’ 2023 ruling.
- Judge Torres had provided legal clarity on the status of XRP, stating that the altcoin is “not a security” in secondary-market transactions, meaning on exchange platforms.
- XRP is treated as a security in the institutional sales made by Ripple, and the firm is awaiting the judge’s final decision on this issue.
- Ripple expressed its confidence that the Judge will take a “fair approach” and that the legal clarity on XRP is here to stay.
Ripple Q2 2024 report
- Ripple noted that the firm is awaiting the final decision in the SEC lawsuit.
- The cross-border payment remittance firm noted a steep decline in on-chain activity in XRP QoQ. The report states that this is common to other cryptocurrencies as well and quotes a 65.6% decline in transactions QoQ.
- Binance, Bybit and Upbit were the dominant exchanges in XRP transaction volume.
Technical analysis: XRP loses key support, drops 6%
Ripple broke out of its downward trend on July 13. XRP erased nearly 6% of its value on Friday and is likely to extend losses further. Ripple could sweep liquidity in the Fair Value Gap (FVG) between $0.4780 and $0.5136. Ripple could find support at the psychological support level at $0.50.
Once the altcoin sweeps liquidity, it is expected to resume its rally toward its target at $0.70. This marks nearly 25% gains from the current price level.
XRP/USDT daily chart
A daily candlestick close above $0.62 could invalidate the thesis of further correction and XRP could rally toward its $0.70 target.
SEC vs Ripple lawsuit FAQs
It depends on the transaction, according to a court ruling released on July 14: For institutional investors or over-the-counter sales, XRP is a security. For retail investors who bought the token via programmatic sales on exchanges, on-demand liquidity services and other platforms, XRP is not a security.
The United States Securities & Exchange Commission (SEC) accused Ripple and its executives of raising more than $1.3 billion through an unregistered asset offering of the XRP token. While the judge ruled that programmatic sales aren’t considered securities, sales of XRP tokens to institutional investors are indeed investment contracts. In this last case, Ripple did breach the US securities law and will need to keep litigating over the around $729 million it received under written contracts.
The ruling offers a partial win for both Ripple and the SEC, depending on what one looks at. Ripple gets a big win over the fact that programmatic sales aren’t considered securities, and this could bode well for the broader crypto sector as most of the assets eyed by the SEC’s crackdown are handled by decentralized entities that sold their tokens mostly to retail investors via exchange platforms, experts say. Still, the ruling doesn’t help much to answer the key question of what makes a digital asset a security, so it isn’t clear yet if this lawsuit will set precedent for other open cases that affect dozens of digital assets. Topics such as which is the right degree of decentralization to avoid the “security” label or where to draw the line between institutional and programmatic sales are likely to persist.
The SEC has stepped up its enforcement actions toward the blockchain and digital assets industry, filing charges against platforms such as Coinbase or Binance for allegedly violating the US Securities law. The SEC claims that the majority of crypto assets are securities and thus subject to strict regulation. While defendants can use parts of Ripple’s ruling in their favor, the SEC can also find reasons in it to keep its current strategy of regulation by enforcement.
The court decision is a partial summary judgment. The ruling can be appealed once a final judgment is issued or if the judge allows it before then. The case is in a pretrial phase, in which both Ripple and the SEC still have the chance to settle.
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